Fresh from launching iits Apple Watch-like Amazfit Blip this week, Huami sold 10 million shares at $11 a pop, the mid-point of its price range. The company joined the NYSE under the 'HMI' ticker symbol. It potentially raised up to $16.5 million more if underwriters working on the listing took the full share option allocated to them.
HMI closed its first day of trading slight up at $11.25 per share.
Huami may not be a name well-known in the U.S., but the company has emerged as one of the biggest sellers of wearable gadgets worldwide thanks in no small part to a partnership with Xiaomi, which is one of its largest investors. The phone maker, which is tipped to go public at a valuation of up to $100 billion, has a 19.3 percent stake in Huami, while Xiaomi CEO Lei Jun's Shunwei Capital firm owns a further 20.4 percent.
Three-year-old Huami is best known for producing budget Mi Band fitness trackers that are sold via Xiaomi. It is perhaps the best example of Xiaomi's smart device platform, which sees Xiaomi work in partnership with device makers to produce and sell hardware using the Xiaomi brand and its Mi.com store.
Huami said it has sold over 45 million devices since its founding in 2013. The company shipped 11.6 million devices during the first nine months of 2017, according to its listing documents. An IDC report ranked Huami (listed as Xiaomi) as the industry's biggest seller alongside Fitbit.
On the business side, Huami posted a $14 million profit for the first nine months of 2017 on total revenue of $195 million. For 2016, it saw a small $3.6 million profit on $234 million in revenue.
Huami CEO Huang Wang at TechCrunch's Shenzhen event in 2017
While its tie-in with Xiaomi gives it distribution, there is concern over the relationship since Xiaomi absorbs a large chunk of some costs that typically impact standalone competitors, such as marketing and distribution.
"We believe Huami’s operating profit is a mirage and reflects a company which for all practical purposes is Xiaomi’s subsidiary masquerading as an independently run company. If Huami were an independently run company designing, manufacturing, marketing and distributing its products, it would be unprofitable," wrote Smartkarma in a report into the listing.
Huami said it plans to use the money on product and tech R&D investments, ramping up sales and marketing, and as working capital that could include acquisitions.
For many, this listing is a prelude to Xiaomi's expected public market entry. The phone-maker has reportedly already tapped CLSA, Goldman Sachs and Morgan Stanley to manage the listing, which is expected to happen in the second half of 2018.
This article originally appeared on TechCrunch.